Borrow from Peter to pay Paul?

Kimberalex

Hi

Ok so I was a bit silly and ordered some items from very, I have a bad credit score but they still gave me a balance (not surprised!)

It's saying to I have to pay £535 by November 16th 2016 to qualify for interest free. That's a bit more than £50 per month.. Or try pay £100 over 5 months (easier said than done)

Would I be better getting a credit card (from a card for bad credit score) to pay very and also getting my credit up?

I've never had a credit card it would be solely to pay very and build my credit score as I was silly when I was younger.

Would I have to pay the £535 back straight away or would I have less time than very give me?

Sorry for all the questions I don't understand APR etc, I'm really naive when it comes to this matter.

grumbler

With Very you don't pay any interest if you pay what you owe by November.
With a CC you'll pay the interest from day 1 if you don't repay in full what you owe within ~20 days after a monthly statement is produced.
So, using a CC to pay Very will cost you, but cannot help with improving noticeably your credit history as, most likely your Very is already reported to CRA(s) the same way as a CC account.

redpete

You would be better off paying the £50 per month to clear the debt before you start paying interest in November. One thing to be careful of is that you might find that the Very interest is back-dated if you haven't cleared the full balance by the date in November - so missing it by 1 day can be very expensive.


You also need to stop perpetuating your 'silly' behaviour that doesn't seem to have stopped now you are no longer 'young'.

SnowTiger

Kimberalex wrote: »

Ok so I was a bit silly and ordered some items from very, I have a bad credit score but they still gave me a balance (not surprised!)

It's saying to I have to pay £535 by November 16th 2016 to qualify for interest free. That's a bit more than £50 per month.. Or try pay £100 over 5 months (easier said than done)

Would I be better getting a credit card (from a card for bad credit score) to pay very and also getting my credit up?

If your budget is so tight that you can't scrape £535 together between now and November you might struggle to get a credit card.

If I were you I'd pay as much as I could during the next nine months, then attempt to switch what's remaining to a credit card before the interest hits the account.

Very accepts credit card payments.

Candyapple

Kimberalex wrote: »

Hi

Ok so I was a bit silly and ordered some items from very, I have a bad credit score but they still gave me a balance (not surprised!)

It's saying to I have to pay £535 by November 16th 2016 to qualify for interest free. That's a bit more than £50 per month.. Or try pay £100 over 5 months (easier said than done)

Would I be better getting a credit card (from a card for bad credit score) to pay very and also getting my credit up?

I've never had a credit card it would be solely to pay very and build my credit score as I was silly when I was younger.

Would I have to pay the £535 back straight away or would I have less time than very give me?

Sorry for all the questions I don't understand APR etc, I'm really naive when it comes to this matter.

Can you not return any/all of the the goods you purchased for £535 or at least some which would reduce your balance?

Clearly you haven't learnt anything from your past mistakes if you think a company giving you a credit limit/increase is a target to spend it and not think about how you are going to pay it back.

You need to head over to the Debt Free Wannabe board (see link below) ASAP and post up a statement of affairs and they will be able to help you. Forget taking out any credit cards, I have no doubt if you did take out a sub prime credit card that all you will be doing is passing the debt from Very onto that, and given they charge 40% APR and upwards, you will begin to drown in interest repayments, especially if you can't even afford £50 per month now.

http://forums.moneysavingexpert.com/forumdisplay.php?f=76

m4rc

All good advice above, a credit card is a bad idea especially as you don't understand APR. You should not have any credit if you don't understand how it works, it is very simple, you must get your head round it.

There are APR to monthly interest rate calculators on Google, so they can tell you what interest you would pay per month. Let's make it simple. If you had a balance of 500, you pay £50 off for that month, and there is an APR of 59.9%. The monthly interest is 3.99%.

Doesn't sound much, but let's do the sums.

£500 - £50 = £450

£450 + 3.99% = £467.96

So your £50 payment paid off £32.04

Next month you do it again.

£467.96 - £50 = £417.96

£417.96 + 3.99% = £434.64

So after 2 monhs you've paid out £100 and your debt has decreased by around £65.

This is just an example, as in theory the credit you got from Very is interest free right now.

So you need to find and ly £535 by middle of November. I would target end of October as the final date to have it cleared to give you a few days spare, that's £535 divided by 9 months, so 59.45 a mon, let's say 8 payments starting is month of £60 and a final payment in October of £55.

In theory there is nothing wrong with interest free credit, it means you can spread the cost and is a good way of budgeting for people who have the funds. It isn't good if you don't have money or don't understand the consequences of debt.

If you do not clear every single last penny of the £535 by the 16th November then they will immiadately add all of the interest on, but it's a bit different then as they add it in full, so even if you paid the following day it will be well over a thousand pounds you will owe. You will be able to pay it off over a,longer period of time, but suddenly all the things you purchased are twice the price you thought you paid - that's not good value. They don't let you pay it off a day or a week later and cut the interest, that's how they make their money.

Very is one of the better mail order companies, many of the prices are similar to high street prices, and when they have offers on there are some bargains, but only if you don't add interest. Start adding interest and it becomes expensive. I use them for things interest free, and when they have a sale or send me a discount code. I had a £40 off £100 at Christmas as I hadn't used them for a while, and I purchased some reduced items, I ended up getting a couple of hundred pounds worth of goods for about £60.

I'm sure you feel like everyone is attacking you but you are an adult, it's not riht to put yourself down and say you don't understand APR and are naive, you need to learn. If it was something you really wanted to know about you would manage I'm sure, I bet you have no issues using a complicated smartphone or working your way round Facebook, put some of that effort into making sure you don't have to pay a serious mount of interest.

Now you need to work out how you can put aside £15 every single week until he end of October so you can get this settled, the quicker you pay it the smaller the risk that you will miss a few payments and find yourself in October facing a £1000 debt. Sorry to say but from your first post it sounds like that's what will happen, I hope you prove me wrong though.

Good luck